Economist: The 2025 budget faces declining oil prices and requires financial discipline.
Economist: The 2025 budget faces declining oil prices and requires financial discipline.
9-2-2025
Information/Special…
Economic advisor Mazhar Mohammed Saleh confirmed on Tuesday that the 2025 budget will undergo a comprehensive review due to the decline in global oil prices from the price set in the General Budget Law of $70 per barrel, stressing the need to rearrange financial priorities.
Saleh said in a statement to Al-Maalouma that “Federal Budget Law No. 13 of 2023 was prepared for three years, but recent changes, most notably the decline in oil prices, have imposed new financial challenges.”
He added that “oil revenues represent more than 90% of budget resources, and when they decline, it becomes necessary to focus on basic expenditures.”
He pointed out that “priority will remain directed towards paying salaries, retirement and social care, in addition to service projects within the government program,” indicating that “the government is operating according to the principle of financial discipline, not austerity, by reducing unnecessary expenditures and resorting to interim domestic borrowing when necessary.”
Saleh pointed out that “Iraq is currently experiencing its third wave of oil price declines since 2014, following the war against ISIS and the coronavirus pandemic,” stressing that “there is financial flexibility and cooperation between fiscal and monetary policy to ensure the stability of public spending, which constitutes approximately 88% of national economic activity.”
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